Arriva plc - AGM - Chairman's statement

Speaking today at Arriva plc’s Annual General Meeting, SirRichard Broadbent, chairman, said:

When we announced our full year financial results forthe year ended 31 December 2006, we reported on a sound performancein changing times. Further growth in mainland Europe, a strongperformance from UK Bus, both in London and the regions, and anexcellent improvement in operational performance at Arriva Trains,underpinned solid financial performance.

Passenger transport markets across Europe continue toopen to competition and it is against this background that ourvision is to become Europe’s leading passenger transportgroup. We pursue opportunities for growth by tender gains and byacquisition, when it makes financial sense, in order to broaden anddeepen our footprint in these evolving markets.

The execution of our ongoing strategy has continuedthis year under David Martin’s leadership. Taking over aschief executive at last year’s AGM, he has providedcontinuity and expertise in maximising our existing opportunities,as well as seeking out new ones.

We are pleased with the development of our existingbusinesses, and the start of 2007 has already witnessed thecontinuation of our growth in mainland Europe. Germany remains akey area of development, and in March 2007 we built upon our strongposition with the purchase of a majority stake in OsthannoverscheEisenbahnen AG (OHE), a public transport group based in Hannover.In January we completed the acquisition of Bosak Bus s.r.o in theCzech Republic, increasing our presence around Prague, andcommenced an eight-year bus contract in southern Holland. In June2007 we will start a nine-year contract to operate regional trainservices in southern Sweden. Two further rail contracts commence inGermany in December 2007, with a third contract from December 2009,and we have recently won a further 10-year rail contract commencingin December 2008, expanding our presence in Brandenburg. We awaitthe outcome of a number of tender submissions, including those forthe Oresund rail link between Sweden and Denmark.

We also anticipate further developments in the UK busmarket. Growth in London is set to continue and we are encouragedby the government’s initiatives to promote public transportin the regions in a bid to deal with the increasing public concernsover congestion and the environment.

In the UK rail division, we look forward to the outcomeof the two rail franchise bids we have already submitted to theDepartment for Transport – East Midlands and Cross Country.In addition, we are currently developing our bid for the InterCityEast Coast franchise, the incremental costs of which will be bornein this year’s results. Success in any of these willtransform our position in the market.

Overall, the Group has made a positive start to theyear in further developing its business. Trading is in line withmanagement expectations.